Venture capital: “Good files always find funding”

The safest decision is to plan for the worst. Californian startup accelerator Y Combinator recently issued this warning to the founders of its portfolio companies. Future fundraisers will be much more difficult, estimates the man who has already supported 3,000 start-ups worldwide. In fact, interest rates are rising, the global economy is slowing sharply, fear is mounting. But the world of venture capital is still moving! The Alpha Intelligence Capital (AIC) fund has just been strengthened by the round table held by the Israeli company Aidoc. This enlarge develops medical imaging software powered by artificial intelligence (AI) that assists radiologists in their diagnosis. “We looked at their technology in a radiology department at a Tel Aviv hospital. A doctor told us it saves lives, says Arnaud Barthelemy, one of four partner by AIC. We had no doubt that Aidoc would be able to raise the needed capital. The operation was also oversubscribed”.

Crisis, what crisis? “Good projects are always funded, but the environment has changed,” he adds. The big American funds from the listed world (Tiger Global, Coatue Management etc.) have left Europe for the time being, and that’s not bad news. You have a very financial culture. You have to turn the money over very quickly with them. We are different “.

AIC was launched in 2018. “We are a global fund, our investors are mainly European,” stresses Arnaud Barthelemy. While he himself is based in Paris, the other three are partner of AIC are installed in the United States, in Singapore and finally in Dubai for the specialist in applied algorithmic science in business, Antoine Blondeau. Your investment universe is that of artificial intelligence (AI) in the narrower sense, that of self-learning, decision-making algorithms. That’s potentially 5 to 6,000 companies in the world, half of which are based in the United States, with the rest spread across China, Israel, the United Kingdom and… France. Two of the 28 lines in AIC’s portfolio fly the French flag: Virtuo, the data-reliant car rental company, and Another Brain, the company founded by Bruno Maisonnier that develops an alternative artificial intelligence solution inspired by how the human brain works.

common thread. “Rising interest rates do not put a direct strain on the ecosystem, because start-ups do not finance themselves with outside capital, but with venture capital or private equity funds. On the other hand, we recommend all the companies in our portfolio to pay attention to the level of their cash flow,” specifies the AIC partner. He distinguishes another development: In an uncertain economic environment, investors are already paying more attention to the annual returns of their potential target persons than to their valuation. “We will continue to give preference to companies that are close to the market and that are able to quickly produce a good or service that they have designed for a well-identified goal.” fund that AIC will raise have no place.

After raising $185 million and investing almost all of it, the venture capitalist is aiming for between $350 million and $400 million this time. “We will keep the same investment thesis, it worked well,” smiles Arnaud Barthelemy. Artificial intelligence will always be the common thread. Incidentally, “we have developed expertise in health and cybersecurity,” he continues. We also believe in Web 3.0 and in companies developing the AI ​​technologies needed to develop this whole parallel digital universe.”

Some silver lining. The crisis has calmed valuations, which had taken a dangerous leap forward, “with multiples of up to 20-30x earnings, not always justified by the growth of the companies affected. It’s over. There is discrimination now,” he says. AIC has already negotiated lower prices, some 40% off, for the entry tickets from companies expected to integrate their second fund. Business is business.

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